Warning

DEVELOPING: OIG Puts Home Health Care in the Crosshairs

The business of healthcare was thrust into the national spotlight last Wednesday with a media triple play.

U.S. Treasury Secretary Jack Lewis reported that the Medicare trust fund will dry up by 2028, two years earlier than previously estimated. At the same time, the U.S. Department of Justice announced an historic healthcare fraud takedown, while the U.S. Department of Health & Human Services (HHS) Office of Inspector General (OIG) issued an alert to home healthcare agencies, putting them on notice.

In the June 22 OIG alert, the agency said its investigations revealed that home health services are vulnerable to fraud, waste, and abuse, noting that federal authorities are “stepping up its enforcement efforts” – having “obtained criminal convictions and reached civil settlements with several home health agencies (HHAs), individual physicians, and heads of home-visiting physician companies that defrauded Medicare by, among other conduct, making (or accepting) payments for patient referrals, falsely certifying patients as homebound, and billing for medically unnecessary services or for services that were not rendered.”

The government’s allegations include that (some) HHAs violated the federal anti-kickback statute by paying physicians, either directly or indirectly, in return for their referrals of Medicare beneficiaries to the HHAs for home health services. The government also alleged that the physicians violated the federal anti-kickback statute by soliciting or receiving payments, either directly or indirectly, from the HHAs in return for referring Medicare beneficiaries to the HHAs. In some instances, these payments were disguised as compensation arrangements for services provided, such as payments purportedly for serving as the medical director of an HHA.

“One positive thing is that the report demonstrates that CMS has tools available to target enforcement action,” William A. Dombi, vice president for law with the National Association of Home Care and Hospice, wrote in an email to RACmonitor. “In this case they indicate that utilization aberrancies in certain data areas indicate higher risk of fraudulent claims.”

Dombi added that he does question the reliability of behavioral measures.

“For example, Dombi asked, “is it really a risk factor that an HHA serves a high proportion of patients without a prior hospitalization?”

“That action may merit support rather than criticism, as those patients saved Medicare the high cost of an inpatient stay by utilizing home health on a timely basis,” he noted. “Currently … there are more home health episodes without a prior inpatient stay than those that have one. With this measure, the OIG effectively condemns most providers.”

In addition to the alleged federal anti-kickback statute violations, the government alleged that HHAs, physicians, and heads of home-visiting physician companies violated other federal laws, including the healthcare fraud statute and the statute prohibiting false statements relating to healthcare matters.

The government also alleged that physicians falsely certified patients as confined to the home when they were not actually homebound. In OIG’s experience, the physicians participating in these schemes typically were not the Medicare beneficiaries’ primary care physicians, who often were unaware that their patients were receiving home health services.